Failed RedGroup bookstores may be shut next week

THE administrator of collapsed book store group RedGroup Retail says unprofitable Angus and Robertson and Borders bookstores could be closed as early as next week.

At a creditors' meeting in Melbourne today, administrator Steve Sherman of corporate restructuring firm Ferrier Hodgson said company management had been considering closing a number of stores prior to the group being placed in administration on February 17, The Australian reports.

"When we do make that decision it's not because we want to make it, it's because we have to make it," he said.

Mr Sherman revealed the company had $6 million in cash and owed $7.8m in employee entitlements, as well as $118m to a subsidiary of private equity group Pacific Equity Partners.

Mr Sherman also defended a decision to require customers holding $15m of gift vouchers to spend additional cash to redeem the value of their vouchers, saying the alternative was to cancel them outright.

Mr Sherman said company management had been considering closing a number of stores prior to the group being placed in administration on February 17.
"When we do make that decision it's not because we want to make it, it's because we have to make it," he said.

The revelations about the chain come as January retail trade figures come in better than expected, helped by a rise in food sales and a recovery in department store sales, economists say.